The pandemic seems like a distant memory today but its impact on economies is still being felt, particularly in the way we work. Nowhere is this more apparent than in the UK, where people work from home 1.5 days a week on average, the second highest number of days globally (after Canada) and more than double the European average. 1
The new ways of working have trickled down into how we dine out, as we reported in the Mastercard Economics Institute’s recent analysis of the dining scenes in the Big Apple in the U.S, and the dining scene across Sydney and Melbourne in Australia. Now we provide an analysis of the “economic clock” in London by leveraging insights from our aggregated and anonymized in-person spending data at London’s restaurants and bars to see how the city’s dining and nightlife have been transformed by the pandemic. We focus on the evolving day and night economies in London, by looking at changes in spending by day of week and time of day.
Restaurant spending in the City and Canary Wharf accounted for 20.1% of total restaurant spending in London before the pandemic. This share has now shrunk to 16.6%, or by 3.5 percentage points (pp). 2
The weekly pattern of spending has also changed. Before the pandemic, restaurant spending in the City and Canary Wharf rose every weekday from Monday onwards, peaking on Friday. In 2023, spending is concentrated between Wednesday and Friday, peaking on Thursday, which has become the most popular day for working in the office. Indeed, only on Thursday evenings is the City's and Canary Wharf’s share of London’s restaurant spending near pre-pandemic levels.
We also found that people spend differently depending on the time of day. Spending per card is 10% above pre-pandemic levels during happy hour as office workers socialize with colleagues when they do meet in person, but 18% and 15% below pre-pandemic levels at lunch and breakfast respectively.
Areas around Whitehall, Victoria and St James's, the site of many government offices, have also seen their share of London restaurant spending fall – from 8.8% of London’s total in 2019 to 7.3% today. The decline in share has been smaller than in the City and Canary Wharf, possibly because Whitehall benefits from tourist attractions like Big Ben and Buckingham Palace. This could explain why restaurant spending in these neighbourhoods has recovered more strongly on weekends than on weekdays.
The West End, which features a mix of office, entertainment and residential areas, has also seen a loss in its share of London’s restaurant and bar spending, which fell by 4 pp from 19.7% in 2019 to 15.7% in 2023. However, the trends differ by mealtime, with the West End losing more during breakfast time (-5.6 pp) than dinner time (-2.5 pp). And despite a sizeable 4.2 pp loss in its share of London’s night-time spending, West End remains the most popular night-time destination, accounting for a quarter of night-time spending in London in 2023.
Mayfair is among the priciest office and residential areas both in the West End and London more generally and home to many fine-dining restaurants and private clubs. The area saw one of the biggest falls in its share of restaurant and bar spending for a single postcode. It went from 3.2% of London’s total in 2019 to 1.9% today, -1.3 pp lower. The fall was driven by night-time spending, declining from 6.4% in 2019 to 4.2% in 2023.
Not all of central London has lost restaurant and bar spending market share to the rest of the capital. In the area that includes South Bank, Bankside, Bermondsey, Borough and Waterloo, the share of restaurant spending was 12.1% before the pandemic, virtually the same as 12% today. The likely reason is that the area has relatively fewer offices but several tourist attractions and many new restaurants in the Bermondsey street area.
Over in the West End, the south-east part of Soho around Chinatown and Soho Square has seen a large increase in its share of restaurant and bar spending, driven by night-time spending, where its share has increased the most of any postcode, by 1.3 ppt.
The adjacent areas, which include Covent Garden, Holborn, Bloomsbury and St Pancras, have also increased their share of restaurant and bar spending, benefitting from the return of students to the area, as well as a recovery in tourism. In those areas, the increase was driven by strong breakfast and lunch spend.
Similarly, in the City, the area between St Paul’s Cathedral and the Millennium Bridge has been supported by the return of tourists offsetting the loss of spend by office workers.
Affluent residential areas in south-east London, such as Blackheath, Denmark Hill, Dulwich and Greenwich, with many white-collar workers likely to work from home, have picked up most of the share of spending on restaurants and bars, rising from 3.7% in 2019 to 6.5% in 2023. While the pickup in spending has been broad-based across mealtimes, Greenwich has drawn in the largest share increase in dinner and happy hour spend. Interestingly, southeast London continues to capture an ever-larger share of spending, expanding even in comparison to 2022.
Other residential areas that have registered notable increases in their share of London’s restaurant spending include parts of southwest London such as Tooting (+0.3 pp across all mealtimes), Battersea/Clapham Junction (+0.4 pp at breakfast), South Kensington (+0.6 pp at breakfast) and Clapham North (+0.7 pp at night-time). In North London, Camden Town and Islington have seen their shares of restaurant spending rise by 0.3 pp.
The changing economic clock of London provides a crucial lesson for businesses and city governments: As work-life balance shifts towards a more hybrid pattern, so does consumer behaviour. Businesses may need to recalibrate their operations to align with these new patterns, optimising services for the new high-traffic days and expanding their offerings for the growing night-time economy.
For city governments, these shifts emphasize a need to rethink urban planning. As economic activity spreads beyond central business districts to residential neighbourhoods, it's critical to ensure that infrastructure, transportation and public services support this dispersed growth.
The “economic clock” is evolving, influenced by hybrid work patterns. This is not just a change in when and where people work but a broader shift in lifestyles. Ignoring these shifts could mean missing significant opportunities for growth and development. By keeping pace with the shifting economic rhythms, businesses and cities can better position themselves for the future.
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Footnotes
1 Cevat Giray Aksoy, Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Mathias Dolls, Pablo Zarate: “Working from Home Around the Globe: 2023 Report,” EconPol Policy Brief 53, July 2023.
2 Mastercard Economics Institute analysis of aggregated & anonymized switched volumes across London through May 2023 YTD relative to the May 2023 YTD. Nominal Pound sterling unadjusted for FX.
3 Mastercard Economics Institute analysis of aggregated & anonymized switched volumes across London by day of week and time of day. Nominal Pound sterling unadjusted for FX.
About the Mastercard Economics Institute
Mastercard Economics Institute launched in 2020 to analyze macroeconomic trends through the lens of the consumer. A team of economists, analysts and data scientists draws on Mastercard insights - including Mastercard SpendingPulse™ - and third-party data to deliver regular reporting on economic issues for key customers, partners and policymakers.
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